Akerna Corp. (NASDAQ: KERN) announced an all-stock merger with Gryphon Digital Mining today.
After the deal closes, Akerna will also sell its software business to POSaBIT Systems Corporation (CSE: PBIT) (OTC: POSAF). Afterwards, Gryphon and Akerna will create a carbon-neutral bitcoin miner that’s committed to ESG practices. Akerna will adopt the name Gryphon Digital Mining going forward.
Additionally, the merger is anticipated to give Akerna shareholders access to the BTC mining industry. Gryphon started mining Bitcoin in September 2021, and has consistently ranked in the top three of bitcoin miners in terms of efficiency, according to publicly available data. Gryphon measures bitcoin efficiency by the number of Bitcoin generated per exahash of hashing power used. It employs bitcoin-equivalents acquired courtesy of its royalty stream in its calculation of its own efficiency.
Gryphon brings a potential revenue generating profile of 1.1 exahash per second (EH/s) on a cost basis of 0.75 EH/s. This comes primarily courtesy of its self-mining operations and independent royalty stream.
Akerna is a cannabis software company that provides consulting services and data analytics, and MJ Platform was its primary product. Gryphon Mining is a cryptocurrency miner that uses only clean energy sources to mine digital assets. POSaBIT is a fintech company operating specificaly in the cannabis space, providing point-of-sale and cashless payment options for cannabis retailers.
POSaBIT will acquire MJ Freeway, which includes MJ Platform and Leaf Data system brands, as well as Ample Organics.
Akerna enters two separate agreements
MJ Freeway tracks cannabis products from seed to scale along the supply chain
The puts POSaBIT in a position to combine complementary offerings and potentially scale its business with established platforms. The company sees the products in question to be likely beneficial, as they could provide a retail solution for cannabis operators with supply chain compliance and assurances.
The company anticipates its products will also continue to serve all verticals of the cannabis industry beyond simply providing for retail operators.
The first of the two agreements Akerna entered into is a securities purchase agreement for MJ Freeway and Ample Organics to POSaBIT for $4 million in cash. Akerna intends to use the proceeds to pay its outstanding accounts payable and take chunks out of any remaining balances on its secured convertible notes.
The second agreement is an agreement and plan of merger, wherein Gryphon will become a subsidiary of Akerna. When the merger goes through, Gryphon equity holders are anticipated to won approximately 92.5 per cent of company, and present Akerna shareholders will get 7.5 per cent. The company’s headquarters will be in Las Vegas, Nevada, and Rob Change will serve as chief executive officer of the newly combined company. The merger includes spaces for seven members on the board of directors of the combined company. Both transactions must close or none of them will, and both are subject to Akerna shareholder approval. The merger transaction is subject to stockholders of Gryphon and approval of the combined company on the NASDAQ.